I'm a home owner.
I bought my first home in 2001 and was very grateful for a lower market and the following upswing. I don't assume that it's as easy 8 years later (see below for my thoughts on starter homes). But regardless most financial advice emphasizes the benefits of home ownership vs. stock market portfolio.
I'm not here to convince anyone of one way or another.
But I can honestly say I would not or could not have been able to save the amount of money that my home is worth or the equity it now has (value - mortgage = net worth). Yes, I COULD have saved the same amount every month that I put on my mortgage (but minus rent). However, the forced savings + increased value = higher net worth.
I just picked up AUTOMATIC MILLIONAIRE HOME OWNER (Chapters Points-Claire has it on liquidation for $5.99). David Bach has a simple way of explaining things. Pick up the original Automatic Millionaire for a very simple/easy/doable approach to finances. None of his books are about greed or materialistic dreams. 1,000,000 = approx. money you will likely make in your lifetime, therefore, why not be smart about it.
Today, the GLOBE AND MAIL had a great piece about HOME OWNERSHIP and the problems my current generation is having with it. Many of us want to both have a home AND travel AND nice toys AND nice cars. I sympathize - I'd like to experience a little life before I'm 50 (and hopefully mortgageless). However, the benefits of a mortgage free life in due time could = higher net worth sooner AND the freedom to be more generous to others as well as more financial freedom.
Check out the article, especially if you're new to home ownership or considering it.
*starter homes: I used to think it was useless buying a starting home (no garage, smaller, condo, etc.) but my experience taught me the value of increasing equity; it was our 1st home that enabled us to buy our 2nd. We could not have (and could still not) afford the home we have now without have 1st buying the 1st one. This doesn't mean I'm going for another upgrade; when a house meets your needs, keep it and become financially free sooner (see Bach's book for more options)
3 comments:
I've also seen many stay in their 1st or 2nd home (or even downsize) simply to live simple lives. Less headaches, more opportunity for generosity, increased financial freedom, less stuff.
mahhh...should have told me.. used to work for Scotia..have a few copies of Bach's books here at home. Will give you his other book if you want.
anyone from westside want a copy - just let me know.
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